Leveson Inquiry: Andy Coulson admits he held News Corp shares

David Cameron's former spin doctor Andy Coulson today dismissed rumours that he kept a potentially explosive diary of his time in the job

David Cameron's former spin doctor denied any “grand conspiracy” between the Government and Murdoch empire today as he gave evidence to the Leveson inquiry.

But Andy Coulson admitted that he failed to declare a £40,000 shareholding in News Corporation while he was in Downing Street.

He also disclosed that Mr Cameron did not directly challenge him
about his knowledge of phone hacking at the News of the World after July
2009, despite a stream of revelations indicating the problem went
deeper.

The details emerged as Mr Coulson spoke publicly for the first
time since being arrested on suspicion of phone hacking and corruption
last year. He has been released on police bail while the investigation
continues.

Mr Cameron faces fresh embarrassment tomorrow when ex-News
International chief executive Rebekah Brooks takes to the witness box.
She is expected to be grilled about her close relations with the premier
who reportedly texted to express sympathy when she was forced to quit.

Mr Coulson insisted it had been his decision to resign as News of
the World editor after royal reporter Clive Goodman was convicted of
phone hacking in January 2007.

He said that within two months George Osborne was courting him to
become the Tories' director of communications. They met for a drink at a
London hotel, according to his statement.

Mr Coulson said: "Having never considered a career in politics, I
was initially reluctant but became more intrigued as the conversation
went on.

"I believe David Cameron called me later that night to say that
Mr Osborne had told him of our conversation and that he would like to
meet."

They did so soon afterwards in Mr Cameron's parliamentary rooms as leader of the Opposition.

Discussions then "stalled" during the local election campaign but restarted towards the end of May.

He told the inquiry: "I was able to repeat what I had said
publicly, that I knew nothing about the Clive Goodman and Glenn Mulcaire
case in terms of what they did."

Mr Coulson said Mr Cameron had not sought any further assurances
over his links to the phone-hacking scandal after July 2009, despite
allegations about pay-offs for victims starting to emerge in The
Guardian newspaper.

"Not that I can recall," Mr Coulson said.

Mr Coulson said it had not been suggested by Mr Cameron or Mr
Osborne but he explained to them that his background at News
International would not be a key to support.

The former journalist was asked about Mr Cameron's admission last July that politicians and the media had become "too close".

He said the premier had not expressed similar regret in private before that.

"I don't remember him doing so," he said.

Mr Cameron "frequently" expressed frustration about the amount of
time he needed to spend with figures from the media. But one exception
appears to have been Ms Brooks, whose husband Charlie was a contemporary
of Mr Cameron at Eton.

"She was his constituent. Charlie Brooks is a constituent of his,
so they lived relatively close to his constituency home but there was, I
think, a fairly long historic family connection," Mr Coulson said.

Questioned on whether he had seen any contacts he regarded as too
close, Mr Coulson responded: "I look at it from the perspective of
whether or not there was improper conversations or a deal done, which I
think is all part of this sort of grand conspiracy that sort of sits
over this idea.

"I never saw a conversation, was party to a conversation that to my mind was inappropriate in that way."

In his written statement, Mr Coulson said he did not perceive any conflict of interest when he took the communications job.

He had sold all current shareholdings in News International by
May 2010. But he accepted there was a potential conflict over restricted
stock in News Corporation that he was granted as part of his severance
package.

That stock "vested" in August 2010 and is worth around £40,000,
although Mr Coulson stressed that he did not know the value while he was
working for Mr Cameron.

"Whilst I didn't consider my holding of this stock to represent
any kind of conflict of interest, in retrospect I wish I had paid more
attention to it," he said in his statement.

"I was never asked about any share or stock holdings and because I
knew that I wasn't involved in any commercial issues, including the
BSkyB bid, it never occurred to me that there could be a conflict of
interest."

He said he was not involved in the News Corp BSkyB bid "in any way, shape or form".

The only connection he had with it were communications issues
following the Daily Telegraph newspaper's revelation that Business
Secretary Vince Cable had suggested he was "going to war" against Mr Murdoch.

Mr Coulson disclosed that he was in contact with News
International public affairs executive Frederic Michel while working for
Mr Cameron.

Details of Mr Michel's contacts with Jeremy Hunt's office over
the BSkyB bid led to the resignation of the Culture Secretary's special
adviser, Adam Smith.

"I met Fred Michel on a few occasions for coffee, including one
occasion possibly in No 10," Mr Coulson said. "The agenda was always
general and we did not, to the best of my recollection, ever discuss
News International's commercial agenda (including BSkyB)."

Mr Michel also helped to organise lunch for Mr Cameron with former Spanish PM Jose Maria Aznar, and may have attended the event.

Mr Coulson dismissed rumours that he had kept a potentially
explosive diary of his time in the job. And he sought to play down the
closeness of his personal relationship with Mr Murdoch.

He said he had "thoroughly enjoyed" working for the media mogul who had always been "warm and supportive".

But he added: "I wouldn't want to overstate it. He was supportive to me as an editor and I enjoyed working in his company."

Mr Coulson also said he still classed Ms Brooks as a friend, but added: "We haven't spoken for a while, for obvious reasons."

Downing Street said civil servants were required to inform their
permanent secretary of "any business interests or holdings of shares or
other securities which they would be able to further as a result of
their official position".

A spokesman said: "It would be normal practice to ask special
advisers to complete a declaration form on coming into government. I
don't know the specifics of the Andy Coulson case."

The Prime Minister's spokesman confirmed that Mr Coulson was
given only the basic security check clearance when he arrived at Number
10.

He added: "There was a decision taken at the outset of this
Government that we wanted to reduce the number of people, and special
advisers in particular, with DV (developed vetting) clearance, partly
because of the cost involved."

The premier did not watch Mr Coulson's evidence session live on
TV - his spokesman said: "He certainly had a number of meetings in his
diary."